Lawmakers spar over budget

BRAD SHANNON, THE OLYMPIAN

Originally published Thursday, March 7, 2002

OLYMPIA -- Senate Republicans and House Democrats jockeyed for budget-negotiating position with their Senate Democratic counterparts Wednesday, each offering suggestions for fixing the state budget.

The House Democrats' plan would add a state keno game, expand gambling opportunities for nonprofit groups and plug four tax loopholes to raise $205 million in new revenue.

If those proposals hit a snag, the Democrats would consider a 5 percent tax surcharge on beer, wine and liquor as well as a tax on toxic substances, said Rep. Jeff Gomboski, D-Spokane, chairman of the House Finance Committee.

Differing proposals

Democrats also would cut nearly $700 million in previously approved spending, while giving state workers and contract employees 2 percent cost-of-living raises, said Rep. Helen Sommers, D-Seattle, the primary budget writer in the House.

"You can see there isn't any good news in any of the budgets," said House Majority Leader Lynn Kessler, D-Hoquiam.

About the same time Democrats were airing their ideas for plugging the state's $1.6 billion budget gap, Senate Republicans were proposing up to $1.5 billion in cuts. Among them: a pay freeze for state workers and a hiring freeze for all state agencies, including nonfaculty staff at higher education institutions.

The Republicans also urged the Legislature, which is controlled by Democrats, to let agency heads contract out $100 million worth of state services such as groundskeeping and building maintenance. They also want to crack down on people who don't legally qualify for the state's subsidized health insurance program, using the resulting savings to cover some of the state's other rising health care costs.

"We're leading with our chins, obviously, but I think it's in the best interest of the public that we do this," Rossi said of his budget suggestions.

The rival budget proposals came as Senate Democrats passed their nearly $22.5 billion budget proposal through the Senate Ways and Means Committee on a party-line vote.

Lawmakers are going down to the wire this weekend in a bid to write operating and transportation budgets by March 14, the scheduled final day of the 60-day regular session.

"If you were the CEO of a major company ... you would take these ideas and you would implement them," said Senate Minority Leader Jim West, R-Spokane.

How seriously the minority Republicans will be listened to in either chamber is unclear. Democrats in both houses are gearing up to negotiate with each other.

Still, Kessler said Rossi should send over his proposals so they can be considered. She said some of his suggestions were good, including a sliding scale for health premiums that would let lower-paid state workers pay a smaller share of health care premiums than higher-paid workers. She said she already is cutting the Legislature's expenses by $1.3 million, a little more than the $1 million Rossi would cut out of lawmakers' mail allowances.

Kessler said other suggestions such as a hiring freeze are already in place but dismissed others, such as putting a $1 million cap on tort claim awards, calling it unconstitutional.

The Appropriations Committee will convene a hearing on the House budget at 8 a.m. today, but it might not get a House floor vote as lawmakers move straight into negotiations between the two houses.

Interest groups reacted cautiously to the House budget plan, which was short on details. Spokesmen for teacher groups said they were glad to see that three teacher-preparation days are retained.

"What pleases us is there's an effort to find new revenues," said Lynn McKinnon of the Washington Public Employees Association.

However, McKinnon said, state workers are leery of the increased costs for health insurance, which could outstrip the 2 percent pay increases for lower-paid workers. A proposed $20 co-payment for insured doctor visits is "awful," she said.

The biggest question for House Democrats is whether they can get a 60 percent vote to expand gambling by nonprofit groups, Gomboski said. If not, he's prepared to propose the alcoholic-beverage tax increase to raise $70 million or the hazardous substances tax, from which agriculture is exempted.

Except for some of the taxes, the House Democrats' plan is quite similar to the Senate Democrats' in several respects, which boosted hopes by Kessler and Sommers that agreement will be reached quickly.

Both budgets spend almost the same amount the 2001-03 budget cycle. Both also cut more than $650 million from existing programs, and both rely on tobacco settlement money and reserves to bridge the $1.6 billion budget shortfall.

On the Web:

- Senate Ways & Means: 2002 Supplemental Budget Proposals

- Senate Ways & Means Fiscal Updates 2002

- Washington State Legislature

- Washington State Treasurer

- Gov. Gary Locke

Sound Off at TheOlympian.com: How do we weather Washington state's budget crisis?

Arts update

The Senate budget proposal now includes money to cover the $250,000 in back taxes owed by The Washington Center for the Performing Arts, said Sen. Karen Fraser, D-Thurston County.

Also covered by the appropriation to the Department of Community, Trade and Economic Development is money for other nonprofits, Fraser said. At issue are the groups' failure to pay taxes on fees they charge to for-profit groups that use their facilities.

The tax break, which is built into the budget, would need to win approval in the House as well as the signature of Gov. Gary Locke.

The Olympian Copyright 2002

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